NEW REGULATIONS PUBLISHED FOR THE FAIR CHANCE IN HOUSING ACT
As you may recall on June 18, 2021, the New Jersey’s Governor Murphy signed the Fair Chance in Housing Act (the “FCHA”) into law. You can read a summary of the law here. The law, among other things, overhauls the apartment application process and restricts a landlord’s ability to consider certain aspects of an applicant’s criminal history.
As the agency that oversees the FCHA, the New Jersey Division on Civil Rights (“DCR”) was required to develop certain model notices and publish regulations surrounding the FCHA’s implementation. Last month, the DCR released a Model Disclosure Statement and a Model Withdrawal Notice (the “Model Notices”). You can read more about these notices here. Recently, on January 3, 2022, the DCR adopted and published rules and regulations for the purpose of effectuating and clarifying the FCHA.
These rules and regulations provide insight into how the DCR will be interpreting and enforcing the FCHA. The changes made by these regulations, while minimal, are important. The most significant updates surround the Model Notices. The regulations state that the Model Notices must be standalone documents, in at least size 12 font, and include an acknowledgement that the applicant has received the notice. This rule does not mean that landlords must use the Model Notices—a landlord may still choose to use its own drafted disclosure statement. However, as explained below, using the Model Notices may have certain benefits.
According to the FCHA, prior to accepting any application fee, housing providers are required to disclose to the applicant, in writing:
- whether the eligibility criteria include the review and consideration of the applicant’s criminal history; and
- a statement that the applicant may provide evidence demonstrating inaccuracies in the criminal record, or evidence of rehabilitation or other mitigating factors.
Pursuant to this requirement, the DCR released the Model Disclosure Statement, as a sample that landlords are permitted to use. Under the new regulations, if a landlord chooses to provide the applicant with the Model Disclosure Statement (instead of a notice of its own design), in size 12 font, with an acknowledgement that it was received by the applicant, then—providing the acknowledgement is signed—the landlord is automatically deemed to have satisfied this requirement under the FCHA. Put another way, if the applicant acknowledges receipt of a correctly formatted Model Disclosure Statement, then the landlord is automatically considered in compliance with this section of the FCHA.
In the same way, under the FCHA, when a landlord withdraws an applicant’s Conditional Offer, the landlord must provide the applicant with a written notification that includes:
- the reasons for withdrawal; and
- an opportunity to provide evidence demonstrating inaccuracies in the criminal record, or evidence of rehabilitation or other mitigating factors.
The DCR released the Model Withdrawal Notice as a sample satisfying this requirement. As with the Model Disclosure Statement, if a landlord uses a correctly formatted Model Withdrawal Notice, with a signed acknowledgement, then the landlord shall be deemed to be in compliance with this section of the FCHA.
Summarized, under the law, landlords are required to provide certain written notices to applicants upon accepting an application fee, and upon withdrawing a Conditional Offer. As long as a landlord provides these notices at the right times, the landlord is complying with that requirement of the FCHA. The Model Notices provided by the DCR, though, are significantly more comprehensive than what a landlord is required to provide under law. If a landlord chooses to draft its own notices, and a complaint is issued against the landlord under the FCHA, the sufficiency of the landlord’s notices could be called into question. Put another way, if there is a complaint, the DCR may choose to review whether the landlord’s notice is truly complying with the FCHA’s requirements. Provided the landlord is following the FCHA, any review by the DCR should not be an issue. However, if a landlord had used the Model Notices from the beginning, then no review would be necessary: By virtue of using the DCR’s Model Notices, the landlord is automatically in compliance.
For landlords this means that using the Model Notices (as a standalone document, in size 12 font, with an acknowledgement), may save hassle and will ensure that the landlord’s notices are complying with the FCHA. If a landlord uses its own drafted notices, those notices may still be in compliance, but that compliance would not automatically be presumed. If a landlord chooses to use its own drafted notices, it would be wise to ensure that those notices: (1) are provided to applicants as documents separate from the application itself; (2) are drafted in at least size 12 font; and (3) contain an acknowledgement. While a landlord is not legally required to provide the notice as a separate document, in a certain font size, or with an acknowledgement, doing so will be perceived more favorably by the DCR and the courts. Additionally, as the regulations allow for electronic acknowledgements that the applicant has received the notice, a read receipt on an emailed copy of the notice will likely be a sufficient acknowledgement.
If you are interested in updated your Disclosure Statement or your Withdrawal Notice to comply with the FCHA or to align more closely with the DCR’s recommendations, we can help. We, at Griffin Alexander, P.C., are experienced in landlord-tenant law and can help familiarize you with all the requirements of New Jersey’s Fair Chance in Housing Act.
The information in this Client Alert is provided solely for information purposes. It should not be construed as legal advice on any specific matter and is not intended to create an attorney-client relationship. The information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular circumstances. Each legal matter is unique, and prior results do not guarantee a similar outcome.
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